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Comment by thebean11 | Hacker News Reader

Don't count your chickens before they vest, in 6 months somebody might be getting them at $90

Assuming the compensation is 2/3 salary, 1/3 equity, that drop is only 10%. I'm worrying more about keeping my job than the value of my equity.

Yea, but who has more time for the market to swing back up than a 22 year old?

A 21 year old.

It's advisable to hold your RSUs for at least one year for a favourable tax treatment, so the 33% discount he got is still very good; he's likely not going to sell his RSUs in six months.

He got the offer and decided on his start date way back in August of last year so any luck he happens by is good luck. He could've chosen to be luckier if the stock price goes down further, but I'd say this is pretty lucky as it is already for something he can't control.

Edit: ignore the tax part, I think I'm wrong there.

Isn't the favorable tax treatment only on the appreciation from the vest price?

Ah I'm not too sure. That might be the case.

RSU is taxed at vest, exactly like cash bonus for tax purposes. If you sell it immediately, it's really exactly like cash.

And you can't offset your capital losses with RSU vesting, really really exactly like cash haha.

Yes. RSUs for publicly traded companies are for functionally equivalent to a cash for tax purposes. Not selling them immediately is the same as if your employer had given you a cash bonus and you bought shares of the company with the whole thing.

I'm not sure what tax treatment you're talking about, but I'm guessing you mean converting short-term capital gains into long-term. RSUs are taxed as income based on the price on the vesting date, so if you sell when it vests there's no capital gains and thus no advantage in waiting.

That said, I think Microsoft still does a 1-year cliff, so they won't have anything to sell for a year anyway.

You're thinking of ESPP, and that's 12 or 18 months.

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